Illinois lawmakers line up in opposition to sales tax on advertising

A bipartisan coalition of 70 Illinois House members is publicly opposing putting a sales tax on advertising as a way to help the state deal with its crushing financial problems.

House Resolution 889, filed Wednesday by local Rep. David McSweeney, R-Barrington Hills, puts a majority of the House on record as opposing the idea, which has been floated by the administration of Gov. Bruce Rauner as part of expanding the state sales tax to services as other states do.

McSweeney said such a tax would slow economic growth and directly conflicts with Rauner’s stated goal of improving Illinois’ business climate.

The advertising tax was not part of Rauner’s proposed 2016 budget, and McSweeney said he filed the resolution to keep it that way.

“I want to make sure this idea doesn’t come back again because it hurts businesses. They tried it in Florida, and it was a disaster,” McSweeney said.

In 1987, Florida overhauled its sales tax code to include services as well as advertising.

The state lost millions as major companies slowed down advertising and relocated conventions in protest, and its lawmakers repealed the provision six months later.

No other state imposes a direct sales tax on advertising, although Hawaii and New Mexico charge a levy on advertising that acts similarly to a sales tax.

Businesses that rely heavily on advertising, including real estate companies, media agencies, advertising firms, billboard companies and automotive sales, have come out against the proposed tax.